Re: What SINGLE factor MOST contributed to the demise of Packard?

Posted by Rusty O\'Toole On 2013/10/19 14:17:09
Quote:

Peter Packard wrote:
G'day all, Hi from the Antipodes;

I have slogged though all of the posts and there are many notable ones including;
.Dilution of the brand by introduction of the 120/110
.Dependance on not-forthcoming Defence contracts after WW11.
. Brand stagnation in chasing Chev/ ford into the late 40's and Fifties.
. Disasterous merger with virtually bankrupt Studebaker.
. An inability to revert to manufacture of 50,000 pa luxury only market with manufacturing facilities for 200,000.
My head spins when I think of how the Packard Board was dealing with this and it was obviously troubled by all of these problems.

IMHO the single factor which most contributed to the demise of Packard was dilution of Public trust in the purchase of a Packard once Packard merged with Studebaker. Packard had assumed an orphan status which was a death wish.

Just my 2 cents worth PT


Dilution of brand. The 110 and 120 saved Packard. They did not kill it. If they had, Packard would have gone out of business in 1940. They dropped the 110 and 120 when they introduced the Clipper in 1941 and they stopped building 6 cylinder cars in 1947. From 1948 on there was no vestige of the 110 or 120 left. 1948 was the best sales year Packard had in the postwar period. To say people refused to buy Packards in 1956, because of a model they built 20 years earlier is absurd. They did not buy Packards in 1956 because they did not want 1956 Packards, it had nothing to do with 1936 Packards.

Non forthcoming defence contracts. This is a valid point but it is worse than you think. Packard was a leading supplier of aircraft engines, boat engines and other military gear until their contracts were cancelled in the mid fifties. This was the doing of "engine Charlie" Wilson, ex General Motors executive, now Secretary of Defense, and his "narrow based procurement policy" which basically meant buying everything from General Motors.

This left Packard holding the bag after spending $17 million on a new jet engine factory.

Brand stagnation. Packard never chased Chev or Ford. After 1947 they made large, eight cylinder cars exclusively. The only other brands with this policy were Cadillac, Buick, Lincoln, and Mercury. These were all medium priced and high priced brands. Such well thought of cars as Chrysler, DeSoto, Oldsmobile and Studebaker made mainly six cylinder cars. Packard did not.

An inability to revert to 50000 PA luxury cars. Here you put your finger on it. For various reasons to do with mass production it was impossible to make such a small number of cars, sell them at a profit, and have enough left over to develop a new model. In the post war period the progress in design was tremendous. New OHV V8 engines, auto trans, power steering, power brakes, all kinds of power accessories. Air conditioning, new braking and suspension systems. New body styles every year, at least a major face lift, and an all new design every 2 or 3 years. Packard made a valiant effort to keep up but in the end, fell behind.

This is why it drives me crazy when people blame Packard's demise on building cheap cars. For one thing they never built cheap cars. For another their only salvation was to mass produce cars in sufficient numbers to make a profit. The days of hand built cars with custom built one off bodies were long gone. Cars of the highest reputation like Pierce Arrow, Stutz and Peerless went bankrupt in the depression trying to follow this policy. It is sheer madness to think it possible after 1930, to stay in business with anything but a mass produced car.

Even 50,000 sales per year were not enough to pay for the new tooling needed every year to keep up to date.

I believe it would have been possible for them to sell 100,000 to 200,000 cars per year. In fact they sold over 100,000 cars in 1948 and again in 1951. If they had moved with the times and gotten their V8 engine out a few years sooner, and if they had more up to date body styles they could have sold 100,000 per year or more every year.

The fifties were really the heyday of the medium priced and high priced car. For the first time since the depression people had money to spend. They no longer were willing to settle for the cheapest plain sedan. They wanted chrome, 2 tone paint, V8 engines and all the modern conveniences.

In 1953 Plymouth introduced a new, more practical, more sensible car that was smaller than the model it replaced. Sales went to hell. Buick actually outsold Plymouth that year even though Buick was a much more expensive car.

It was the same everywhere. The new hardtop convertibles were a sensation, and everywhere it seemed car buyers wanted the latest, longest, lowest, flashiest car they could get.

Packard should have been right on top of this market but they let it slip through their fingers.

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